SBA has initiatives underway or planned that, according to the Administrator, will fundamentally change ODA’s organization and program. Many of the initiatives begun in response to Katrina will be continued or expanded, but the vision goes further. The SBA Accelerated Disaster Response Initiative team is looking for ways to tap into the private sector, both to learn from it and to obtain its support during major disaster responses. Additionally, within ODA, three business process reengineering teams are working to develop new approaches to key aspects of ODA’s operation: Administration, Personnel, and Loan Processing and Disbursement. Several initiatives are already being developed.
Three themes frame these changes: (1) maximize use of automation, (2) integrate ODA more effectively into SBA (but without sacrificing the esprit de corps and strength of the current ODA culture), and, (3) reach out beyond ODA in times of major disasters. Three of the most important changes are briefly described below, including moving to an on-line application, developing a disaster plan and a related field engagement plan, and adjusting the organizational structure.
Automation and On-line Registration
SBA had been thinking about instituting an on-line application for several years, and the concept was again under consideration in early 2005. But it was not developed, at first because of the stress of the 2005 hurricanes, and later because the new SBA Administrator saw more fundamental problems in the loan approval and disbursement process; problems addressed, in part, by the changes discussed earlier.
The initiative is once again moving forward. The Administrator expects that the on-line application process will be tested by the end of 2007. According to an ODA official, the prototype is already working and technical requirements should be completed soon. SBA’s
Business Technology Investment Council and the Office of Management and Budget have approved the proposal to automate the application process. If current estimates are correct, the new process will be available by the 2008 hurricane season. In addition, the Administrator stated that work will continue on redesign of the whole “front end of the process” for another 9-12 months.
Additionally, as recommended by the Inspector General, work is underway to expand access to the web-based DCMS system to others in SBA who could support the agency’s disaster response.
Disaster Response Planning
SBA recently completed its Disaster Recovery Plan. (Panel members did not have the opportunity to review the Plan before the completion of this study). Officials explained that, historically, SBA relied on the expertise and skill of ODA’s leadership, and the dedication of its staff, to ensure effective disaster response. The Gulf Coast storms, however, pointed to a need for a more organized, formal, and pre-planned approach. SBA officials also said that through the process of formulating the plan they have developed innovative approaches to carry out their mission, focusing more on automation and reaching out beyond SBA for help.
The Disaster Response Plan will provide standard operating procedures governing preparations for, and responding to, declarations of disasters of various dimensions. Additionally, a Field Engagement Plan will spell out how staffing will be accomplished in disasters of different magnitudes. SBA officials explained that, together, these plans seek to ensure the agency will be able to staff up to a “catastrophic” level with as few totally new staff members as possible, maximizing the use of existing facilities and systems. The plans will address staffing, facilities, and system capacity, as well as coordination on the ground with the media and other federal, state, and local responders. Officials identified several key aspects of the plans that are expected to enhance the agency’s response capabilities.45
Facilities
New approaches are being used to ensure that necessary and appropriate space is available for staff mobilized in a catastrophic disaster. In this regard, SBA has identified opportunities to expand currently used office space to accommodate additional staff when needed in emergencies. It has also “mothballed” space it no longer needs, keeping it in reserve for possible expansion in a disaster. This alternative, however, may prove to be too costly in the long-run.
Consequently, SBA intends to maintain an on-going relationship with the General Services Administration (GSA) to ensure that GSA has a clear understanding of the kind of space and support SBA needs for different disaster scenarios, and to work periodically to identify what space might be available under various circumstances.
45 The Panel did not review SBA’s own plans for operating in an emergency, for example if one of the offices was unable to operate because of a fire or other disaster. However, SBA officials indicated that each facility has in place a plan to ensure resumption of operations as quickly as possible. For example, the DCMS database is backed up in almost real time. Should the need arise, an alternate facility located in Tempe, Arizona, would be brought on-line, the backup database accessed, and SBA staff would then log onto the alternative system. Based on recent tests, officials estimated they could accomplish this in 6-8 hours.
Reserve Corps
SBA has had a Reserve Corps for many years. The Corps, however, was not maintained at sufficient levels to meet catastrophic needs. Essentially, the Reserve Corps is comprised of competitively selected, pre-trained individuals who are hired and remain on the rolls in a non-pay status and agree to be called up and deployed to disaster areas on 48 hours notice. This facilitates quick staff build-up because SBA does not need to advertise and recruit this staff after a disaster occurs, and because Corps staff do not have to undergo many of the pre-hiring screenings required of new employees. They are already trained to participate in the disaster response. They can serve in a variety of positions, including Customer Service Representative, Loss Verifier, legal, and loan processing staff.
As shown in Table 2-3 above, SBA began to expand the Reserve Corps in 2005, but according to officials, the process was not fully implemented by the time of the Gulf Coast storms. Efforts are again underway, however, to re-engineer the Reserve Corps. In revitalizing the Corps, SBA is taking a two-tiered approach. The “ready reserve” consists of personnel who had been hired relatively recently. (There are several thousand current and former temporary employees who have significant experience as a result of work during the Gulf Coast hurricanes.) These people would not need to be trained before being deployed, at least in the near future; however, unlike other reservists, they have not committed in advance to being deployed. “Active reserve”
members, in contrast, have agreed to deployment on 48 hours notice. As of April 2007, SBA reported about 900 active reservists on the rolls. Personnel in this category will receive about one week of training each year.46
Use of SBA-Wide Staff
Plans are being made to make much greater use of SBA staff outside of ODA during catastrophic disasters. As currently envisioned, staff will be called up in the following order: current ODA staff, Reserve Corps members, other SBA staff (and perhaps volunteers from other federal agencies), and new (temporary) hires. In order to facilitate participation by other SBA staff, several changes are being contemplated:
• Staff in SBA district offices will be cross-trained to perform disaster program tasks. SBA is working to define what this training will entail. The district offices, officials said, appear to be eager to participate.
• Most of the staff members in other SBA offices are unionized; their job descriptions do not explicitly allow for deployment during emergencies. Consequently, SBA staff cannot be deployed to other geographic areas unless they volunteer. SBA officials intend to change the job descriptions for new employees to include the possibility of mandatory deployment. Officials are considering working with the unions to change job descriptions of existing employees to include the possibility of deployment.
46 Officials indicated that the FIT also has a Reserve Corps, numbering about 200 in April 2007. Unlike other Corps members, these personnel are “intermittent” employees” who, when in pay status are hourly workers, and do not
• Absent changed job descriptions, officials will work to identify volunteers in advance from among existing SBA staff.
• Access to DCMS will be expanded to other SBA staff.
Reaching Beyond SBA
SBA has contracted with three loan service providers to provide support in underwriting and closing loans during major disasters. The agency is considering other types of support that might be available from commercial banks and other financial institutions. Though far from making a decision, other roles could include, for example, disbursing funds—from an escrow account set up by SBA—or actually making loans.
SBA “partner” organizations—the Service Corps of Retired Executives (SCORE), Small Business Development Centers (SBDCs), and Women’s Business Centers (WBCs)—have in the past been involved in disaster response, especially in support of outreach to the small business community. SBA is looking for ways to involve these organizations more effectively and more expansively in communicating information about loan availability and procedures in the aftermath of major disasters.
Better Forecasts of Resource Needs
In support of this planning effort, the agency reports that it has enhanced its capability to forecast application volumes when disasters strike, as well as its ability to better determine resource needs—financial, human capital, and logistics—to maximize its response when confronted with different levels of application volumes. GAO questioned, however, whether this effort went far enough. In February 2007 GAO recommended that SBA set timeframes for implementing its disaster management plan—for example cross-training staff—and that it further assess whether the use of disaster simulations or catastrophe models, rather than reliance on agency expertise and previous disaster experience, would enhance the agency’s disaster planning process. 47 According to SBA officials, the agency is still exploring the use and value of the external modeling that GAO recommended, but simulations are included in the new plans.
Officials said they conducted their first simulation exercise in May 2007.
Difficulties Must Be Overcome
Many of these ideas are not new and, when tried in the past, have had only limited success. ODA officials point to problems in using SBA-wide staff, noting that different personnel authorities—
especially those affected by union contracts—limit the extent to which non-ODA staff can be deployed to meet the high demands of disaster response situations. They noted that in the aftermath of Hurricane Katrina, few SBA staff volunteered to be mobilized. Moreover, as discussed earlier, the Reserve Corps has existed for some time, but membership has waxed and waned; it is difficult for Corps members to maintain their knowledge and skills if there are long
47 U.S. Small Business Administration: Additional Steps Needed to Enhance Agency Preparedness for Future Disasters, GAO-07-114 (February 2007).
periods of relatively low disaster activity. Likewise, SBA has had little success in mobilizing private sector entities, especially commercial banks, to support it in a large mobilization. The success in contracting for help in loan processing is, however, promising.
Better Integration of ODA into SBA
SBA Administrator Preston believes that to most effectively implement the integrated approach envisioned by these plans—especially participation by district staff in disaster loan processing and the necessary cross-training and access to DCMS—ODA must be better integrated organizationally into SBA. The organizational alignment has already been changed, making ODA one of five program offices reporting to the Administrator, rather than being a more distinct entity, as it had been.
The Administrator emphasized, however, and the Panel concurs, that these changes must be made carefully, to protect ODA’s culture from unnecessary disruption. The separate IT and personnel offices were established to better ensure that services could be delivered quickly during disaster response. SBA officials recognize that ODA has operated effectively in most situations for many years. The existing staff have considerable expertise and experience and have been able to effectively respond in most situations. These officials also point to the important esprit de corps and true dedication that drives the ODA staff to work 18-hour days and do whatever is needed during disaster response. That is too important an asset to jeopardize, and must be considered as changes in the relationship of ODA to the rest of SBA are proposed or implemented.
CHAPTER III